How the Nation Lost Interest in Its Appetite for the Pizza Hut Chain
Once, Pizza Hut was the favorite for parents and children to indulge in its all-you-can-eat buffet, endless salad selection, and self-serve ice-cream.
However not as many customers are frequenting the restaurant nowadays, and it is closing 50% of its British restaurants after being rescued from insolvency for the second instance this year.
It was common to visit Pizza Hut when I was a child,” explains a young adult. “It was like a family thing, you'd go on a Sunday – spend the whole day there.” Today, in her mid-twenties, she comments “it's no longer popular.”
For young customer Martina, some of the very things Pizza Hut has been known and loved for since it started in the UK in the mid-20th century are now outdated.
“The manner in which they do their buffet and their salad bar, it feels like they are cutting corners and have reduced quality... They provide so much food and you're like ‘How can they?’”
Because grocery costs have risen sharply, Pizza Hut's unlimited dining format has become very expensive to operate. Similarly, its locations, which are being reduced from over 130 to just over 60.
The business, in common with competitors, has also experienced its expenses increase. In April this year, staffing costs increased due to higher minimum pay and an rise in employer social security payments.
Chris, 36, and Joanne, 29 explain they would often visit at Pizza Hut for a date “every now and then”, but now they choose Domino's and think Pizza Hut is “not good value”.
Based on your order, Pizza Hut and Domino's rates are close, notes a culinary author.
Even though Pizza Hut does offer off-premise options through delivery platforms, it is falling behind to larger chains which specialize to the delivery sector.
“Another pizza company has succeeded in leading the off-premise pizza industry thanks to strong promotions and frequent offers that make consumers feel like they're getting a bargain, when in reality the base costs are relatively expensive,” says the specialist.
But for the couple it is acceptable to get their date night sent directly.
“We absolutely dine at home now rather than we eat out,” says the female customer, reflecting recent statistics that show a drop in people going to casual and fast-food restaurants.
In the warmer season, casual and fast-food restaurants saw a six percent decline in diners compared to the previous year.
Additionally, one more competitor to restaurant and takeaway pizzas: the supermarket pizza.
A hospitality expert, senior partner at a leading firm, explains that not only have grocery stores been selling premium prepared pies for a long time – some are even promoting countertop ovens.
“Shifts in habits are also playing a factor in the performance of quick-service brands,” says Mr. Hawkley.
The increased interest of high protein diets has increased sales at chicken shops, while affecting sales of high-carbohydrate options, he adds.
As people go out to eat less frequently, they may look for a more high-quality meal, and Pizza Hut's classic look with comfortable booths and red and white checked plastic table cloths can feel more dated than upmarket.
The growth of artisanal pizza places” over the last decade and a half, for example new entrants, has “fundamentally changed the general opinion of what good pizza is,” says the industry commentator.
“A thin, flavorful, gentle crust with a select ingredients, not the excessively rich, thick and crowded pizzas of the past. This, in my view, is what's resulted in Pizza Hut's downfall,” she states.
“What person would spend a high price on a tiny, mediocre, unsatisfying pizza from a large brand when you can get a stunning, expertly crafted classic pizza for under a tenner at one of the many traditional pizzerias around the country?
“The decision is simple.”
A mobile pizza vendor, who owns a small business based in a county in England explains: “It's not that stopped liking pizza – they just want improved value.”
The owner says his adaptable business can offer premium pizza at accessible prices, and that Pizza Hut struggled because it was unable to evolve with new customer habits.
At an independent chain in a city in southwest England, owner Jack Lander says the industry is diversifying but Pizza Hut has not provided anything new.
“Currently available are by-the-slice options, artisanal styles, New Haven-style, sourdough, Neapolitan, Detroit – it's a wonderful array for a pizza enthusiast to discover.”
Jack says Pizza Hut “should transform” as the youth don't have any fond memories or allegiance to the company.
Over time, Pizza Hut's share has been sliced up and spread to its more modern, agile rivals. To sustain its high labor and location costs, it would have to raise prices – which commentators say is tough at a time when household budgets are tightening.
A senior executive of Pizza Hut's overseas branches said the rescue aimed “to safeguard our dining experience and save employment where possible”.
He said its first focus was to continue operating at the open outlets and off-premise points and to help employees through the restructure.
However with significant funds going into operating its locations, it may be unable to spend heavily in its takeaway operation because the sector is “complex and using existing third-party platforms comes at a expense”, commentators say.
But, he adds, cutting its costs by withdrawing from crowded locations could be a smart move to adjust.